Moving house is an expensive task whichever way you look at it. Whether it is to a rental property or even buying a new place, there are so many things that need to be considered when moving. Solicitors, admin fees, stamp duty, and surveyors all cost money, and after a while, the fees start to rack up. It is important to have everything in order first before even considering moving; otherwise, you may get yourself into all sorts of trouble.
The figures
According to the most recent figures from Barclays bank, the average cost of moving house, excluding the value of the property itself, stands at roughly £8,885. Whilst this figure does fluctuate depending on where in the country you are, for example, a property in central London will cost considerably more than one in Stoke-on-Trent, that’s still nearly £9,000 that is needed upfront just to complete the sale. All of this does include stamp duty, insurance and solicitors’ fees, but it is still expensive. Unsurprisingly, the highest average mortgage is in London, with figures ranging from £284,247 with a low 1.7% interest over 25 years to £381,018 at 4.33% interest over 30 years. These figures alone generate between £50,000 to £100,000 of interest payments, showing just how expensive certain parts of London are to live in. This isn’t to say it is all doom and gloom, though. With an estate agents East London based, you can find properties but with fees at lower prices, with a view to helping you secure that dream home, even if it might seem just out of reach for now.
How to improve your circumstances?
Scraping the money together for a deposit on a house is difficult as the fee required is based off of the average household income, and that’s before companies even run a credit check to see if you are a viable option. Quite often, banks and mortgage brokers will be reluctant to agree to mortgages if you have a poor credit history as you might seem like too much of a risk, especially if there are defaults on any borrowing you may have had. Little amounts of debt can be okay as long as you can prove that you are on top of the payments and can maintain it long term. It might be worth minimising any credit cards or loans as much as possible to give yourself the best possible chance of qualifying for a mortgage, otherwise renting might well be your only option. Getting on top of your finances is of paramount importance, though, as by reducing your debt levels, you stand a chance of qualifying for lower interest mortgage options, which, as mentioned before, can pay up to £100,000 less than the higher interest. If you are planning on applying for a mortgage, try not to take out any other credit in the meantime, as it could suggest that you have a reliance on credit and are not a viable option. Obviously, if your credit score is good, you shouldn’t have any issue getting a mortgage, but if you have a poor rating, it is important to start rectifying it quickly before it is too late.
Summary
Now there is no sure-fire way to ensure that you can get a mortgage as much of it does rely on individual circumstances, but by taking some of the steps above, you can at least improve your future prospects. Improving your credit score can have a positive effect on your financial future, but it does take some graft to get there. Without it, you might struggle to ever see your ideal home.
